Thursday, March 24, 2011

Return to the Center of the World

Gavyn Davies points us to a neat map created by Danny Quah at the LSE in his recent paper "The Global Economy's Shifting Centre of Gravity" (pdf). In it, Quah calculates "the average location of economic activity across geographies on Earth." Here's the map:

The westernmost black dot on the map represents where the Earth's center of economic gravity was in 1980 - somewhere in the Atlantic Ocean, a bit west of the Madeira islands. Since then it has drifted eastward to its current position near Cairo. The red dots then extrapolate the motion of this point until 2050, assuming the next 40 years are characterized by similar growth patterns to the past 30 years.

One of the things I love about this map is that it reminds me (in an admittedly purely superficial way) of one of my favorite economic models: the "gravity" model of trade flows, in which the trade between two countries or regions is roughly predicted by the size of the two regions and how far apart they are, just like physical gravity.

More substantively, I also find it interesting to think about this movement of the world's economic center of gravity as really just backtracking, an undoing of the point's westward movement that took place between about 1700 and 1900. From the time of the first pyramids until perhaps the 16th or 17th century, the world's economic center of gravity consistently hovered in the Middle East somewhere. Its movement westward into the Atlantic is really a relatively recent phenomenon. (Granted, if Quah's projections are correct, we may overshoot a bit as the point moves back east to where it came from, but that remains to be seen.)

It's not a coincidence that nearly all European maps of the world until the 16th century had the Middle East (often specifically Jerusalem) in the middle of the map. To medieval European map-makers, the Middle East was, and had always been, right at the center of the world, geographically, spiritually, and economically. Note that the requirement to represent that visually is what led to the classic T-O maps of the European Middle Ages. (The T-O maps are oriented with east at the top, with the Mediterranean forming the vertical stroke of the 'T', and with the Middle East right at the center of the world where the three continents meet.)

In that context, Quah's map above - and the changes in the world economy that it so nicely distills - could be interpreted as simply the correction of a temporary global aberration.

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The Street Light is written by economist Kash Mansori, who works as an economic consultant (though views expressed here are entirely his own), writes whenever he can in his spare time, and teaches a bit here and there. You can contact him by writing to the gmail account streetlightblog. (More about Kash.)